There's been some chatter in media & marketing circles on the need for an AppNexus replica in Pakistan, to counter to issues of Google's AdExchange. To learn more about the issues faced by agencies, I spoke to Faiz Kazi of Glowfish Capital about his take on this idea.
If there are so many issues with the current tech, why hasn't anyone done this yet?
To put it as simply as possible, the current issues are not with the tech but the market we exist in.
Digital advertising in Pakistan is network heavy, that means we go through ad exchanges more than we do impression buys (rightly so). Going with real time bidding (RTB) means evolving to a level where the clients are willing to pay more for each and every impression/click due to the inherent superiority of the data centric targeting involved. But buying into RTB is not child’s play, I don’t know of a single advertiser in Pakistan that has their own agency desk, the buy in's are somewhere $50k plus starting spend commitment each month, basically it’s like getting a country club membership. Even though we are one of the rare agencies in Pakistan who happen to have their own proprietary agency trading desk in international markets, it’s still an evolutionary step that needs more stakeholder buy in than financial buy in.
In your opinion, how many advertisers are capable of moving $50k of advertising spend per month to a RTB platform and keep at it throughout the year to qualify for the honor?
Coming to your question about why not do these locally, well to begin with you need demand dollars (advertisers) to access supply sources. In Pakistan or any other country how do you go about getting demand dollars without proper supply sources first, it’s a chicken and egg problem. Even when you have demand dollars you won’t have the economies of scales that the already existing Demand Side Platform's (DSP’s) such as AppNexus, MediaMath, Google DBM, etc. have. To put everything in perspective, Google DBM right now has access to 13 exchanges on last count, the most any DSP has. Now imagine a Pakistani startup regardless of having licensed or developed a decent bidder trying to get in on these exchanges, it’s not going to be cheap or easy.
If the chatter has certitude and someone were to do this, what should their counter be to Google?
Google already provides a DSP solution, called DoubleClick bid manager. What it does is simple: helping you access its AdSense inventory and inventory from several other places and helps you to buy it in CPM terms while using additional variables for enhanced targeting, defining cost for every lead or impression.
You need to have proper data about every user being served, cookie tracking or what not. RTB's advantage is being able to target people you want - without the data you can't. As things are today Google is still the world’s biggest non-social ad network, coexisting with Google is a more appealing proposition than without it. A Pakistani startup could start off as an agency desk offering low buy ins like MightyHive does for the US market at $5k, build a portfolio of advertisers within the region instead of just in Pakistan and bring RTB essentially to the masses.
What would happen if Atlas was used?
Your 18 million plus Facebook users (or accounts) just don't use the internet to surf on Facebook, they use the internet to surf other websites, possibly a site like Tribune too. Let’s assume I currently run my ads on Tribune or intend to, with Atlas vs a direct buy, the difference here is my 500,000 impressions or whatever I bought can now be targeted to real identities - imagine custom audiences. Furthermore cross device targeting in a cookie based world is virtually non-existent. But Atlas can now track a person vs. a cookie tracking a device and also help in controlling the frequency overlap that clients coming from TV scream murder about.
Furthermore the level of demographic targeting available on Atlas is far more interesting than it is on Google. We all lived in a world of contextual and RTB enabled behavioral targeting but that was just the start, demographic and people based targeting is the future.
What is the wave these days?
Apparently locally it’s eCommerce and P2P commerce, consider the fact even Ufone now has an online shopping portal, by that logic it would make sense even for Standard Chartered to have one and innovate by offering it’s account holders products on Installments. We’ve got Facebook groups where pre-loved is the new fad, scores of women selling their old stuff, new stuff. Some folks who own a debit card or a credit card are now service providers, peddling their wares to the still frightened lot who won’t risk using their own cards on AliExpress by helping others to buy online.